Opposition Leader Bill Shorten has pledged to renew scrutiny of China's human rights record and labelled the country's crackdown against Muslim minorities "gravely disturbing" in the first public comments on the sensitive subject from a leader of a major Australian political party.

As global concern grows about the Chinese Communist Party's mass detention of up to 1 million Uighurs and other Muslim minorities under a broader crackdown in the north-western province of Xinjiang, Mr Shorten said Labor would speak "truth to power" in a respectful way.

Bill Shorten speaking at the Lowy Institute on Monday.Credit:AAP

"Where values diverge, we won't ignore issues. What I won't necessarily do is do it through a megaphone but I would like to see us resuscitate a greater human rights dialogue with China," he said in response to questioning after a foreign policy address to the Lowy Institute on Monday.

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"There's no doubt in my mind that we don't have all the information that people are asking for in terms of the treatment of the Uighur minority and that what we've seen is gravely disturbing."

Despite lobbying efforts by the Coalition government, a formal Australia-China human rights dialogue has not been held since 2014. Beijing wants the program of annual meetings, established in 1997, downgraded from a ministerial to departmental level.

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A growing body of reporting from Xinjiang has found the Chinese government has detained Uighurs in facilities – labelled "vocational training centres" by authorities – as part of an effort to suppress religious practices and instil Chinese Communist ideology. Uighurs not in detention live in an increasingly advanced surveillance state.

In his speech, Mr Shorten warned against "worst-case assumptions" about China and promised to take a "no surprises" approach to the relationship.

The Opposition Leader's speech contained an emphasis on the Pacific, including a commitment to increase aid funding and establish an infrastructure investment bank to provide concessional loans for development projects in the region in addition to Australia's foreign aid program.

While some development experts cautiously welcomed the proposal, some warned that Australia had to be careful not to overload Pacific nations with debt.

Security personnel in Xinjiang.Credit:AP

Mark Purcell, chief executive of the Australian Council for International Development, praised Mr Shorten's overall approach to the Pacific but said loans should not come at the expense of the grants-based foreign aid program.

"Australia shouldn’t be part of a lending race in the region. Given the concern that many Pacific countries are some of the least developed in the region, Australia shouldn’t be forcing them to choose between debt repayments and their own investment in health and education," Mr Purcell said.

Responding to the concerns, Mr Shorten said multiple governments would back the facility, direct loans would be a "good, judicious" use of taxpayer dollars, and projects would be based on Pacific communities' priorities.

"Energy infrastructure, the internet, water, ports, infrastructure. I think it's a smart way of combining a scarce amount of precious Australian dollars with the know-how ... of those communities."